Trenton taxpayers to be stuck with failed hotel debt for more than a decade

TRENTON — A sale through bankruptcy did not wash the city’s hands clean of the former Trenton Marriott’s debt.

City council introduced an ordinance Tuesday to refund the city-backed bonds for $11.5 million after the hotel was sold last week for $6 million at auction.

Less than $3.5 million of the sale price will go to the current outstanding bond of $14.475 million because of closing costs and a $2 million loan taken out to keep the hotel afloat until the new owners take over. Last week, Edison Broadcasting won the auction which drew the interest of one other party with a $6 million bid.

Before the auction, the 197-room hotel, which opened in 2002, was hobbled with approximately $30 million in debt, including the city bond, a combined $9 million in state loans and more than $7.3 million owed in a note to the Trenton Parking Authority.

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The city is expected to pay off the remaining bond balance in approximately 13 years.

But there is a silver lining.

Because the building will be in private hands as anticipated on Dec. 11 at the sale closing, the hotel will be back on the tax rolls and the city will receive revenue from the hotel tax to help eat away at the bond debt.

About the Author

Originally from Webster, N.Y., David has been a reporter in N.J. for the past three years (first in Phillipsburg and now in Trenton).He is a Temple alum who interned at the Philadelphia Daily News. Reach the author at dfoster@trentonian.com
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